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Koreans are 'home bias' in equity investment

Koreans are 'home bias' in equity investment

Domestic equity funds saw higher net inflows than overseas equity funds in Korea last month, according to the Korea Financial Investment Association (KFIA).

In March, domestic equity funds posted net inflows of KRW 0.02 trillion ($19 million), while overseas equity funds saw a net inflow of KRW 0.1 trillion ($94 million).

Net assets for domestic equity funds and overseas equity funds was KRW 63.4 trillion ($59 billion) and KRW 22.1 trillion ($21 billion) respectively.

Net assets for overseas equity funds slid KRW 0.4tn ($370 million) to KRW 22.1 trillion, as a result of tumbling global stock markets.

Meanwhile, the bond market in Korea remained relatively stable, even as the US interest rate hike in March.

Total net assets of bond funds slid by KRW 0.05 trillion ($47 million) to KRW 94.3 trillion ($88 billion) in March from previous month.

Compared with February, the net assets of domestic bond funds saw an inflow of KRW 0.2 trillion ($190 million) to KRW 84.2 trillion ($79 billion), with a net capital inflow of KRW 0.07 trillion ($65 million).

The net assets of overseas bond funds, meanwhile, declined KRW 0.3 trillion ($280 million) month-on-month to KRW 10.1 trillion ($9.4 billion), with a net capital outflow of KRW 0.3 trillion.

 Alternatives

Within the alternative space, hybrid assets funds saw the biggest capital inflow in March.

Interestingly, the net assets of hybrid assets funds posted KRW 16.5 trillion ($15 billion) in March, a 10.9% increase from previous month, with a net capital inflow of KRW 1.5 trillion ($1.4 billion).

Meanwhile, the net assets of real estate funds posted KRW 64.2 trillion ($60 billion) in March, a 1.4% increase from the previous month end, with a net capital inflow of KRW 0.9 trillion ($840 million).

The net assets of special assets funds registered KRW 59.6 trillion ($56 billion), with a net capital inflow of KRW 0.6 trillion ($560 million).

The net assets of fund of funds enjoyed a gain of KRW 0.06 trillion ($56 million) month-on-month to KRW 26.1 trillion ($24 billion) in March, with a net capital inflow of KRW 0.3 trillion ($280 million).

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